This Small Oil Producer is Ripe for a Takeover… Here’s How to Profit

by Sheena Martin, Contributing Editor Friday, November 20, 2009

Takeovers are big news in the market at the moment.

In fact, did you know that takeovers have the biggest one-day gain in stocks for any asset?

As my colleague – and takeover expert – Louis Basenese says, they’re “some of the safest companies you can own. According to FactSet Merger Stat LLC, the average one-day return for shareholders of the target company is 48%.”

Furthermore, Louis says, “Industries naturally go through cycles of consolidation – waves of mergers, acquisition and takeovers.”

One industry riding this wave as it comes out of recession is oil. And I have a takeover target making strides in oil exploration that could put money in your pocket in a few months

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For Immediate Release

Chicago, IL – November 6, 2009 – Zacks.com announces the latest Industry Outlook. Today, Zacks Equity Research discusses the Oil & Gas sector, including CNOOC Ltd. (CEO), China Petroleum and Chemical Corporation, or Sinopec (SNP), Cameron International (CAM), Nabors (NBR) and Patterson-UTI (PTEN).

A synopsis of today’s Industry Outlook is presented below. The full article can be read at http://www.zacks.com/stock/news/26953/Oil+%26amp%3B+Gas+Industry.

The strengthening oil price environment should benefit producers, particularly those international players having attractive growth opportunities in their home markets. Two such standout names are China’s CNOOC Ltd. (CEO) and China Petroleum and Chemical Corporation, or Sinopec (SNP), both of which remain well-placed to benefit from the country’s growing appetite for energy.

CNOOC enjoys a monopoly on exploration activities in China’s very prospective offshore region in addition to having a growing presence

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OUTLOOK The improving economic scene, both here in the U.S. as well as worldwide, is the main driver of the current oil rally that has seen the commodity settling around the $80 per barrel level. But high levels of product inventories (particularly gasoline), along with still higher supplies, will limit any sustained crude gains, in our view. But way too many factors weigh on oil prices, from OPEC decisions and geostrategic tensions to the value of the U.S. dollar and seasonal variables, to definitively size up each one of them for their respective impact on prices.  In its latest release, the Energy Information Administration (EIA) reported a less-than-anticipated increase in crude stockpiles, which rose by 800,000 barrels for the week ending October 23. However, current crude oil stocks, at 339.9 million barrels, still remain 9% above the year-earlier level as well as above the upper limit ...

CNOOC Ltd. (CEO) expects to sign a deal with Norway’s StatoilHydro ASA (STO) soon to buy stakes in some deepwater exploration blocks in the U.S. Gulf of Mexico (GoM). StatoilHydro is putting five prospects on the market, out of its more than 400 leases in the U.S. GoM. The company had acquired these assets, with 100% working interest, in 2007 and 2008 lease sale. This deal could mark the introduction of China's foray into the U.S. GoM. The GoM remains one of the most abundant areas of the world for oil discoveries, with billions of barrels of crude believed to be trapped beneath the seabed. Chinese companies are pursuing assets acquisitions abroad to cope with the country’s increasing demand for oil and gas. But they are facing difficulties in tying up deals partly because the oil-rich countries want greater control over their resources. We ...

Today we are featuring top-performing “Chinese equity" mutual funds that invest most of their assets in equity securities of companies that trade in China or are related to the Chinese economy.

Investors can find such funds by checking out the entire list of the Zacks #1 Rank Chinese Equity Funds list.

3 Excellent Picks

Dreyfus Greater China A (DPCAX) was incepted in May 1998 and seeks long-term capital appreciation. It may include invest in common stocks, preferred stocks and convertible securities, including those purchased in initial public offerings. It is non-diversified.

The fund primarily invests in stocks of companies that are principally traded in China, Honk Kong or Taiwan, derive at least 50% of their revenues from Greater China, or have at least 50% of their assets in Greater China.

Sino-Ocean Land Holdings Ltd., Zhuzhou CSR Times Electric Co. Ltd. and Bengang Steel Plates Co. Ltd. are

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The emerging positive narrative of a favorable outlook for the U.S. economy has done wonders for the markets, particularly equities and commodities. The broad equity markets as well as most commodity groups are up smartly from their early-March lows.

Crude oil's gains have been even more impressive, given its heavy leverage to the health of the global economy. Our view is that oil should be able to hold onto its recent gains and consolidate around current levels, provided this favorable economic view remains in place.

While we have greater confidence in the staying power of the current oil rally, this does not mean that we will not see any short-term pullbacks. On the whole, we expect oil prices in 2010 to be higher than the 2009 levels, but remain significantly below the 2008 peak levels.

Crude oil's near-term fundamentals remain dismal, to say the least. Inventories in the U.S. are at multi-year highs

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The emerging positive narrative of a favorable outlook for the U.S. economy has done wonders for the markets, particularly equities and commodities. The broad equity markets as well as most commodity groups are up smartly from their early-March lows. Crude oil’s gains have been even more impressive, given its heavy leverage to the health of the global economy. Our view is that oil should be able to hold onto its recent gains and consolidate around current levels, provided this favorable economic view remains in place. While we have greater confidence in the staying power of the current oil rally, this does not mean that we will not see any short-term pullbacks. On the whole, we expect oil prices in 2010 to be higher than the 2009 levels, but remain significantly below the 2008 peak levels. Crude oil’s near-term fundamentals remain dismal, to say the least. Inventories ...

For Immediate Release

Chicago, IL – September 2, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: PetroChina Company Ltd. (PTR), Sinopec (SNP), Total SA (TOT), CNOOC Ltd. (CEO) and Vodafone (VOD).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Tuesday’s Analyst Blog:

PetroChina Sings 'O Canada'

Yesterday, PetroChina Company Ltd. (PTR), the largest integrated oil company in China, agreed to pay C$1.9 billion ($1.7 billion) to acquire a majority stake in two oil sands projects in western Canada.

As per the terms of the agreement with Athabasca Oil Sands Corp.

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Yesterday, PetroChina Company Ltd. (PTR), the largest integrated oil company in China, agreed to pay C$1.9 billion ($1.7 billion) to acquire a majority stake in two oil sands projects in western Canada. As per the terms of the agreement with Athabasca Oil Sands Corp. (a privately held Calgary-based group), the Chinese energy giant will purchase a 60% working interest in the Canadian company’s proposed MacKay River and the Dover ventures in northern Alberta. The deal, which awaits certain regulatory approvals, is currently the largest venture by China in Canadian oil sands. According to an independent third party evaluation, the oil sands that PetroChina plans to exploit are estimated to contain as many as five billion barrels of reserves, about half of Athabasca’s total recoverable resources. Peak production from the two sites is projected to reach 300,000 – 500,000 barrels per day, with first volumes expected in ...

For Immediate Release

Chicago, IL – September 1, 2009 – Zacks Equity Research highlights CNOOC, Ltd. (CEO) as the Bull of the Day and China Eastern Airlines (CEA) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Goldman Sachs Group Inc. (GS), Morgan Stanley (MS) and American Express Company (AXP).

Full analysis of all these stocks is available at http://at.zacks.com/?id=2676

Here is a synopsis of all five stocks:

Bull of the Day:

With favorable prospects for the resumption of China's economic growth and commodity prices off of their lows, CNOOC, Ltd. (CEO) ADSs are expected to maintain their recent impressive performance momentum.

This, coupled with the company's positive production-growth profile, exclusivity in the offshore China region and lucrative LNG investments, account for continued favorable view.

The company's low cost operating model is also a competitive advantage. With

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